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Restructuring and Related Activities Disclosure

NOTE 9 — REVENUE

Our revenue is substantially generated from product sales. For the three months ended March 31, 2018, approximately 89% of our revenue was generated from product sales. Our remaining revenue was derived from services, leases and other, which represented approximately 7%, 3%, and 1%, respectively, of total revenue for the three months ended March 31, 2018. Product revenue is derived from the sale of drilling and production equipment. Service revenue is earned as technical advisory assistance and field services related to our products are provided. Lease revenue is derived from month-to-month rental income of leased production equipment.

The majority of our revenue is short cycle in nature with shipments occurring within a year from the customer order date. A small portion of our revenue derives from contracts extending over one year. Our payment terms generally range between 30 to 90 days and vary by the location of our businesses and the types and volumes of products manufactured and sold, among other factors. Costs incurred to obtain a customer contract are generally not material to us.

Disaggregation of Revenue

Revenue disaggregated by end market in each of our reporting segments was as follows:



	Three Months Ended March 31,
(in thousands)	2018
Drilling Technologies	$	69,231
Production & Automation Technologies:
Artificial lift technologies	167,341
Automation technologies	24,363
Other production equipment	24,696
Intra-segment eliminations	(1,709		)
Total	214,691
Total revenue	$	283,922

Revenue disaggregated by geography was as follows:



	Three Months Ended March 31,
(in thousands)	2018
United States	$	221,239
Canada	22,584
Middle East	10,338
Europe	9,022
Latin America	7,686
Asia-Pacific	6,070
Other	6,983
Total revenue	$	283,922

Performance Obligations

The majority of our contracts have a single performance obligation which represents, in most cases, the equipment or product sold to the customer. Some contracts include multiple performance obligations such as a product and the related installation, extended warranty and/or maintenance services. For contracts with multiple performance obligations, we allocate the transaction price to each performance obligation based on the estimated relative standalone selling prices of the promised goods or services underlying each performance obligation. We typically use observable prices to determine the stand-alone selling price of a performance obligation and utilize a cost plus margin approach when observable prices are not available.

Substantially all of our performance obligations are recognized at a point in time and are primarily related to our product revenue derived from the sale of drilling and production equipment. Revenue is recognized when control transfers to the customer upon shipment or completion of installation, testing, certification, or other substantive acceptance provisions required under the contract. Revenue is recognized over time for our service and lease offerings. Service revenue is recognized over time as we provide technical advisory assistance and field services related to our products.

Warranties

The majority of our contracts contain standard warranties in connection with the sale of a product to a customer which provide a customer assurance that the related product will function for a period of time as the parties intended. In addition to our standard warranties, we also offer extended warranties to our customers. Warranties provided as part of our product offering are analyzed to determine whether they represent a distinct service, and if so, are recognized as service revenue over the related warranty period.

Remaining performance obligations

As of March 31, 2018, we did not have any contracts with an original length of greater than a year, from which revenue is expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied).

Contract balances

Contract assets and contract liabilities from contracts with customers were as follows:



(in thousands)	March 31, 2018	January 1, 2018
Contract assets	2,806	4,733
Contract liabilities - current	5,947	4,487

Contract assets primarily relate to our right to consideration for work completed but not billed at the reporting date and are recorded in “prepaid expenses and other current assets” on our condensed combined balance sheets. Contract assets are transferred to receivables when the right to consideration becomes unconditional. Contract liabilities relate to our obligation to transfer goods or services to a customer for which we have received advance consideration (or an amount of consideration is due) from the customer. Current contract liabilities are recorded in other “accrued expenses and other current liabilities” on our condensed combined balance sheets.

Critical Accounting Estimates

Estimates are used to determine the amount of variable consideration in contracts, the determination of the standalone selling price among separate performance obligations, as well as the determination of the measure of progress for contracts where revenue is recognized over time. Some contracts with customers include variable consideration primarily related to volume rebates. We estimate variable consideration at the most likely amount to determine the total consideration which we expect to be entitled. Estimated amounts are included in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. Our estimates of variable consideration and the determination of whether to include estimated amounts in the transaction price are largely based on an assessment of our anticipated performance and all information that is reasonably available.

Restructuring Activities

3 Months Ended

Mar. 31, 2018

Restructuring [Abstract]

Restructuring and other charges by reporting segment were as follows:



	Three Months Ended March 31,
(in thousands)	2018		2017
Production & Automation Technologies	$	482	$	6
Drilling Technologies	—		—
Total	$	482	$	6

Classification of amounts in the condensed combined statements of income:
Cost of goods and services	$	3	$	(7	)
Selling, general and administrative expense	479		13
Total	$	482	$	6

Restructuring and other charges of $0.5 million incurred during the three months ended March 31, 2018, primarily reflect severance costs in our Production and Automation Technologies segment. Our restructuring and other programs were designed to better align our costs and operations with current market conditions and include measures such as targeted facility consolidations, headcount reductions and other actions to further optimize our operations. We expect the initiatives currently underway to be substantially completed in the next 12 to 18 months.

Our liability balances for restructuring and other exit activities was $2.5 million and $2.6 million as of March 31, 2018 and December 31, 2017, respectively, and primarily reflected restructuring plans initiated in 2017, as well as ongoing lease commitment obligations for facilities closed in prior periods.

Income Taxes	3 Months Ended
Income Taxes	Mar. 31, 2018
Income Tax Disclosure [Abstract]
Income Taxes	NOTE 11 — INCOME TAXES Our operations have been historically included in Dover’s U.S. combined federal and state income tax returns. Income tax expense and deferred tax balances are presented in these condensed combined financial statements as if Apergy filed its own tax returns in each jurisdiction. These condensed combined financial statements include tax losses and tax credits that may not reflect tax positions taken by Dover. In many cases, tax losses and tax credits generated by Apergy through the date of the Separation were utilized by Dover. Our income tax provision reflected effective tax rates for the three months ended March 31, 2018 and 2017 of 22.6% and 31.4%, respectively. The year-over-year decrease in the effective tax rate was primarily due to the Tax Reform Act, which was enacted on December 22, 2017, and which permanently reduced the U.S. corporate income tax rate from a maximum of 35% to 21%, effective January 1, 2018. We recognized provisional tax impacts related to deemed repatriated earnings and the benefit for the revaluation of deferred tax assets and liabilities in our combined financial statements for the year ended December 31, 2017. The provisions in the Tax Reform Act are broad and complex. We have not yet completed our accounting for the income tax effects of the Tax Reform Act as of March 31, 2018, but have made reasonable estimates of those effects on our existing deferred income tax balances and the one-time deemed repatriation tax. The final financial statement impact of the Tax Reform Act may differ from our estimates, possibly materially, due to, among other things, changes in interpretations of the Tax Reform Act, any legislative action to address questions that arise because of the Tax Reform Act, and changes in accounting standards for income taxes or related interpretations in response to the Tax Reform Act, or any updates or changes to estimates we have utilized to calculate the provisional impacts. The SEC has issued rules allows for a measurement period of up to one year after the enactment date of the Tax Reform Act to finalize the recording of the related income tax impacts. We expect to finalize our analysis related to the Tax Reform Act by the end of the measurement period. As subsidiaries of Dover, we file U.S., federal, state, local and foreign tax returns and are routinely audited by the tax authorities in these jurisdictions of which a number of audits are currently underway. We are no longer subject to examinations of our federal income tax returns for years through 2013. All significant state, local and international matters have been concluded for years through 2012. We did not have any recorded liabilities for uncertain tax positions as of March 31, 2018 and December 31, 2017. We did not have any income tax payable balances as of March 31, 2018 and December 31, 2017. Income tax payables at each balance sheet date computed under the stand-alone return basis are classified within “net parent investment in Apergy” on the condensed combined balance sheets since Dover is legally liable for the tax.

Fair Value Disclosures (Notes)	3 Months Ended
Fair Value Disclosures (Notes)	Mar. 31, 2018
Fair Value Disclosures [Abstract]
Fair Value Disclosures [Text Block]	NOTE 12 — FAIR VALUE MEASUREMENTS We had no outstanding derivative contracts as of March 31, 2018 and December 31, 2017. Other assets and liabilities measured at fair value on a recurring basis as of March 31, 2018 and December 31, 2017, were not significant; thus, no fair value disclosures are presented. The carrying amounts of cash and cash equivalents, trade receivables, accounts payable, as well as amounts included in other current assets and other current liabilities that meet the definition of financial instruments, approximate fair value due to their short-term nature. Credit Risk By their nature, financial instruments involve risk, including credit risk, for non-performance by counterparties. Financial instruments that potentially subject us to credit risk primarily consist of trade receivables. We manage the credit risk on financial instruments by transacting only with what management believes are financially secure counterparties, requiring credit approvals and credit limits, and monitoring counterparties’ financial condition. Our maximum exposure to credit loss in the event of non-performance by the counterparty is limited to the amount drawn and outstanding on the financial instrument. Allowances for losses on trade receivables are established based on collectability assessments.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Equity and Cash Incentive Program

3 Months Ended

Mar. 31, 2018

Share-based Compensation [Abstract]

Equity and Cash Incentive Program

NOTE 13 — EQUITY AND CASH INCENTIVE PROGRAM

Dover granted share-based awards to its officers and other key employees, including certain Apergy individuals. All awards granted under the program consisted of Dover common shares and are not necessarily indicative of the results that Apergy would have experienced as a stand-alone public company for the periods presented. Effective with the Separation, outstanding Dover share-based awards were converted to Apergy share-based awards, with the exception of outstanding Dover performance share awards that relate to a performance period ending after the Separation. Such performance share awards were cancelled effective with the Separation. See Note 16 — Subsequent Events for additional information.

Dover’s plan authorized the grant of stock options, stock-settled stock appreciation rights (“SARs”), restricted stock, restricted stock units and performance share awards. The exercise price per share for SARs was equal to the closing price of Dover’s stock on the date of grant. The period for which SARs and stock options were exercisable was fixed by the Compensation Committee of Dover’s Board of Directors at the time of grant. Generally, the stock options or SARs vested after three years of service and expired at the end of ten years. Performance share awards vested if (i) Dover achieved certain specified internal metrics and (ii) the employee remained continuously employed by Dover during the performance period. Partial vesting occurred after Separation from service in the case of certain terminations not for cause and for retirements.

Dover’s board of directors typically granted equity awards annually at its regularly scheduled first quarter meeting. During the three months ended March 31, 2018, Dover issued no equity awards to Apergy employees. During the three months ended March 31, 2017, Dover issued SARs covering 79,970 shares, performance share awards of 4,162 and restricted stock units of 24,319 to Apergy employees.

Stock-based compensation expense is reported within “selling, general and administrative expense” in the condensed combined statements of income. Stock-based compensation expense relating to all stock-based incentive plans was as follows:



	Three Months Ended March 31,
	2018			2017
Stock-based compensation expense	$	510		$	601
Tax benefit	(113		)	(208		)
Stock-based compensation expense, net of tax	$	397		$	393

Employee Benefit Plans

3 Months Ended

Mar. 31, 2018

Defined Benefit Plan [Abstract]

Employee Benefit Plans

NOTE 14 — EMPLOYEE BENEFIT PLANS

Multi-employer Defined Benefit Plans and Non-Qualified Plans

Prior to the Separation, Apergy participated in the following plans as though they were participants in a multi-employer plan with the other businesses of Dover. Accordingly, a proportionate share of the cost associated with these plans is reflected in the condensed combined financial statements.

Dover provided a defined benefit pension plan for its eligible U.S. employees and retirees (“U.S. Pension Plan”). As such, the portion of Apergy’s liability associated with the U.S. Pension Plan is not reflected in the condensed combined balance sheets and was not recorded at the Separation as this obligation will be maintained and serviced by Dover. Shortly before the Separation, Apergy participants in the U.S. Pension Plan (other than Norris USW participants) fully vested in their benefits, and all participants ceased accruing benefits. In addition, Apergy did not assume any funding requirements or obligations related to the U.S. Pension Plan upon the Separation. Norris USW participants were moved to a new pension plan and continued to accrue benefits. No contributions were made by Dover to the U.S Pension Plan for the three months ended March 31, 2018 and 2017.

Dover also provided a defined benefit pension plan for its eligible salaried non-U.S. employees and retirees in Canada (“Canada Salaried Pension Plan”). As such, the portion of Apergy’s liability associated with this non-U.S. plan is not reflected in our condensed combined balance sheets as this obligation was maintained and serviced by Dover. The Canada Salaried Pension Plan, including all assets and liabilities, was transferred to Apergy at the Separation. Shortly before the Separation, all non-Apergy participants in this plan ceased accruing benefits or were not permitted to make contributions, as applicable. The non-Apergy participants may elect a lump sum cash payment post Separation that will be the responsibility of Apergy, will be funded out of the plan assets, and could also result in a non-cash settlement charge to earnings. Contributions to the Canada Salaried Pension Plan totaled $0.2 million for the three months ended March 31, 2017.

Dover provided to certain U.S. management employees, through non-qualified plans, supplemental retirement benefits in excess of qualified plan limits imposed by federal tax law. As of January 1, 2018, Apergy participants in these non-qualified plans no longer accrued benefits nor were permitted to make contributions, as applicable. Apergy assumed the funding requirements and related obligations attributable to Apergy employees related to these non-qualified plans upon the Separation. The non-qualified plans are unfunded and contributions are made as benefits are paid.

Single Employer Defined Benefit Plans and Other Non-Qualified Plans

We sponsor one defined benefit pension plan to certain hourly non-U.S. employees and retirees. The plan is closed to new participants; however, as of the Separation, all active participants in this plan continue to accrue benefits. This plan is considered a direct obligation of Apergy and will be recorded within our condensed combined financial statements at the Separation.

We also sponsor a non-qualified plan covering certain U.S. employees and retirees. The plan provides supplemental retirement benefits in excess of qualified plan limits imposed by federal tax law. The plan is closed to new hires and all benefits under the plan are frozen. The plan is considered a direct obligation of Apergy and will be recorded within our condensed combined financial statements at the Separation.

Net Periodic Benefit Cost

Net periodic benefit cost relating to our retirement benefit plans was as follows:

Defined Benefit Plans



	Non-U.S. Qualified Defined Benefit Plan
	Three Months Ended March 31,
(in thousands)	2018			2017
Service cost	$	31		$	26
Interest cost	33			34
Expected return on plan assets	(56		)	(49		)
Amortization of actuarial loss	14			17
Net periodic benefit cost	$	22		$	28



	Non-Qualified Supplemental Benefits Plan
	Three Months Ended March 31,
(in thousands)	2018		2017
Service cost	$	—	$	—
Interest cost	112		155
Amortization of actuarial loss	51		82
Net periodic benefit cost	$	163	$	237

Defined Contribution Retirement Plans

We also offer defined contribution retirement plans which cover the majority of our U.S. employees and employees in certain other countries. Expense relating to our defined contribution plans was $2.4 million and $2.0 million for the three months ended March 31, 2018 and 2017, respectively.

Segment Information

3 Months Ended

Mar. 31, 2018

Segment Reporting [Abstract]

Segment Information

NOTE 15 — SEGMENT INFORMATION

We report our results of operations in the following reporting segments: Production & Automation Technologies and Drilling Technologies. Segment revenue and segment earnings were as follows:



	Three Months Ended March 31,
(in thousands)	2018		2017
Segment revenue:
Production & Automation Technologies	$	214,691	$	180,800
Drilling Technologies	69,231		49,478
Total revenue	$	283,922	$	230,278

Income before income taxes:
Segment earnings:
Production & Automation Technologies	$	10,351	$	7,877
Drilling Technologies	24,189		14,720
Total segment earnings	34,540		22,597
Corporate expense and other ⁽¹⁾	2,635		2,805
Income before income taxes	$	31,905	$	19,792

_______________________


(1)	Corporate expense include costs not directly attributable to our reporting segments such as corporate executive management and other administrative functions. Includes the net income attributable to our noncontrolling interest.

Subsequent Events (Notes)

3 Months Ended

Mar. 31, 2018

Subsequent Events [Abstract]

Subsequent Events

NOTE 16 — SUBSEQUENT EVENTS

Separation and Distribution

On May 9, 2018, we entered into definitive agreements with Dover, that, among other things, set forth the terms and conditions of the Separation of Apergy from Dover and provide a framework for Apergy’s relationship with Dover after the Separation, including the allocation between Dover and Apergy of Dover’s and Apergy’s assets, employees, liabilities and obligations attributable to periods prior to, at and after the Separation. In addition to the separation and distribution agreement, which contains many of the key provisions related to the separation of Apergy, the parties entered into an employee matters agreement, a tax matters agreement and a transition services agreement.

The Separation was completed on May 9, 2018, in the form of a distribution of 100% of the shares of common stock of Apergy, which became an independent, publicly-traded company. The distribution was tax-free to Apergy, Dover, and Dover’s U.S. stockholders. Dover shareholders received one share of Apergy common stock for every two shares of Dover common stock. As a result, Apergy had 77.3 million shares of common stock outstanding, par value $0.01, based on 154.7 million shares of Dover common stock outstanding as of May 9, 2018. Following the Separation, Dover retained no ownership interest in Apergy, and each company, as of May 9, 2018, has separate public ownership, boards of directors and management.

Transition Services Agreement

On May 9, 2018, Apergy and Dover entered into a transition services agreement pursuant to which Dover agreed to provide Apergy with various services, including certain information technology services, and Apergy agreed to provide Dover with various services, including certain services related to transitioning operations. Apergy will pay a fee to Dover for services utilized under the transition services agreement, which fee is generally intended to allow Dover to recover all of its direct and indirect costs generally without profit. Except as provided otherwise in the transition services agreement, or with respect to specific services with other specified terms, the initial term of the transition services agreement will end on January 31, 2019, and the term may then be extended until the one-year anniversary of execution of the transition services agreement or such other period set forth on the schedules thereto (subject to earlier termination under certain circumstances).

Tax Matters Agreement

On May 9, 2018, Apergy and Dover entered into a tax matters agreement which governs Apergy’s and Dover’s respective rights, responsibilities and obligations after the Separation with respect to tax liabilities (including taxes, if any incurred as a result of any failure of the Separation or certain related transactions to qualify for tax-free treatment for U.S. federal income tax purposes) and benefits, tax attributes, the preparation and filing of tax returns, the control of audits and other tax proceedings and other tax matters. Neither party’s obligations under the tax matters agreement will be limited in amount or subject to any cap.

Apergy also agreed to certain covenants that contain restrictions intended to preserve the tax-free status of the Separation and certain related transactions. Apergy and certain of its subsidiaries are barred from taking any action, or failing to take any action, where such action or failure to act may be expected to result in any increased tax liability or reduced tax attribute of Dover. In addition, during the time period ending two years after the date of the Separation, these covenants include specific restrictions on the ability of Apergy and certain of its subsidiaries to:


•	issue or sell stock or other securities (including securities convertible into Apergy stock but excluding certain compensatory arrangements);


•	cease to actively conduct its business or dispose of assets outside the ordinary course of business; and


•	enter into certain other corporate transactions which could cause Apergy to undergo a 40% or greater change in its stock ownership.

Employee Matters Agreement

On May 9, 2018, Apergy and Dover entered into an employee matters agreement which governs the respective rights, responsibilities and obligations of the parties in connection with the Separation with respect to employee-related matters. The employee matters agreement provides for the allocation and treatment of assets and liabilities as applicable, arising out of incentive plans, retirement plans, and employee health and welfare benefit programs in which Apergy’s employees participated prior to the Separation and the treatment of outstanding Dover incentive awards. In general, Apergy assumed liabilities related to its current and former employees incurred before the Separation. Dover retained liabilities accrued prior to the Separation related to certain Apergy participants in Dover’s U.S. defined benefit pension plan. As a result of the Separation and effective May 15, 2019, outstanding Dover equity awards held by Apergy employees, other than Dover performance shares, converted into corresponding Apergy equity awards issued under the Apergy Corporation 2018 Equity and Cash Incentive Plan. Generally, each award is subject to the same terms and conditions as were in effect prior to the Separation. Immediately prior to the Separation, outstanding Dover performance shares held by Apergy employees that related to a performance period ending after the Separation were cancelled.

Indemnifications

In connection with the Separation, we entered into agreements with Dover that govern the treatment between Dover and us of certain indemnification matters and litigation responsibility. Generally, the separation and distribution agreement provides for cross-indemnities principally designed to place financial responsibility for the obligations and liabilities of our business with us and financial responsibility for the obligations and liabilities of Dover’s business with Dover. The separation and distribution agreement also establishes procedures for handling claims subject to indemnification and related matters. In addition, pursuant to the tax matters agreement, we have agreed to indemnify Dover and its affiliates against any and all tax-related liabilities incurred by them relating to the Separation and/or certain related transactions to the extent caused by an acquisition of Apergy stock or assets or by any other action or failure to act undertaken by Apergy or its affiliates.

Pro Forma Financial Information



	Three Months Ended March 31,
(in thousands, except per share data)	2018		2017
Net income attributable to Apergy	$	24,543	$	13,269
Pro forma earnings per share: ⁽¹⁾
Basic	$	0.32	$	0.17
Diluted	$	0.31	$	0.17
Pro forma shares outstanding: ⁽²⁾
Basic	77,340		77,340
Diluted	78,329		78,329

_______________________


(1)	Pro forma basic and diluted earnings per share was determined by dividing historical net income attributable to Apergy by pro forma shares outstanding during each of the periods presented.

(2)

Pro forma basic shares outstanding was based on the Apergy shares issued in connection with the completion of the Separation on May 9, 2018, and are assumed to be outstanding during each of the periods presented. Pro forma diluted shares outstanding assumes the full effect of potentially dilutive securities of all outstanding awards under our incentive compensation programs plus pro forma basic shares outstanding during each of the periods presented.

Borrowings and Contribution to Dover Corporation

To fund the Separation, we incurred the following borrowings:

Senior Notes

On May 3, 2018, and in connection with the Separation, we completed the private placement of $300 million in aggregate principal amount of 6.375% senior notes due May 2026 (“Senior Notes”). Interest on the Senior Notes is payable semi-annually in arrears on May 1 and November 1 of each year commencing on November 1, 2018. Net proceeds of $294.8 million from the offering were utilized to partially fund the $700 million cash payment to Dover at the Separation and to pay fees and expenses incurred in connection with the Separation.

The terms of the Senior Notes are governed by the indenture dated as of May 3, 2018, between Apergy and Wells Fargo Bank, National Association, as trustee. At any time prior to May 1, 2021, we may redeem all or part of the Senior Notes at a redemption price equal to 100% of the principal amount of the Senior Notes redeemed plus a premium, as defined in the indenture, plus accrued and unpaid interest. Beginning on or after May 1, 2021, we may redeem the Senior Notes, in whole or in part, at certain tiered redemption prices as defined in the indenture, plus accrued and unpaid interest. The Senior Notes are our senior unsecured obligations. The Senior Notes will rank equally in right of payment with our future and existing senior debt and will rank senior in right of payment to all of our future subordinated debt.

In connection with the private placement, we granted the initial purchasers of the Senior Notes certain registration rights under a registration right agreement. We have agreed for the benefit of the holders of the Senior Notes to use our commercially reasonable efforts to file and cause to be effective a registration statement with the SEC relating to a registered offer to exchange the Senior Notes for an issue of SEC-registered notes with terms identical in all material respects to the Senior Notes. Generally, we have one year from the issuance of the Senior Notes to complete the exchange offer. Should Apergy not complete its obligations under the registration rights agreement within a year, the annual interest rate on the Senior Notes will increase at different intervals based on the passage of time after one year.

Senior Secured Credit Facilities

On May 9, 2018, Apergy entered into a new credit agreement (“credit agreement”) governing the terms of its new senior secured credit facilities, consisting of (i) a seven-year senior secured term loan B facility (“term loan facility”) and (ii) a five-year senior secured revolving credit facility (“revolving credit facility,” and together with the term loan facility, the “senior secured credit facilities”), with JPMorgan Chase Bank, N.A. as administrative agent. The net proceeds of the senior secured credit facilities are expected to be used (i) to pay fees and expenses in connection with the Separation, (ii) partially fund the cash payment to Dover and (iii) provide for working capital and other general corporate purposes.

At our election, outstanding borrowings under the senior secured credit facilities will accrue interest at a per annum rate of (i) LIBOR plus a margin or (ii) a base rate plus a margin. The senior secured credit facilities contain a number of customary covenants that, among other things, will limit or restrict the ability of Apergy and the restricted subsidiaries to, subject to certain qualifications and exceptions, perform certain activities which include, but are not limited to (i) incur additional indebtedness, (ii) make acquisitions and (iii) pay dividends or other payments in respect of our capital stock. Additionally, Apergy will be required to maintain (a) a minimum interest coverage ratio, as defined in the credit agreement, of 2.75 to 1.00 and (b) a maximum total leverage ratio, as defined in the credit agreement, of 4.00 to 1.00 through the fiscal quarter ending June 30, 2019, then 3.75 to 1.00 through the fiscal quarter ending June 30, 2020, then 3.50 to 1.00 thereafter.

Term Loan Facility. The term loan facility will have an initial commitment of $415 million. The full amount of the term loan facility was funded on May 9, 2018. Amounts borrowed under the term loan facility that are repaid or prepaid may not be re-borrowed. The term loan facility matures in May 2025.

The term loan is subject to mandatory amortization payments of one percent per annum of the initial commitment of $415 million paid quarterly. Additionally, subject to certain exceptions, the term loan facility is subject to mandatory prepayments, including the amount equal to: 100% of the net cash proceeds of all non-ordinary course asset sales subject to (i) reinvestment periods an (ii) step-downs to 75% and 50% based on certain leverage targets; and 50% of excess cash flow, as defined in the credit agreement, with step-downs to 25% and 0% based on certain leverage targets. Apergy may voluntarily prepay amounts outstanding under the term loan facility in whole or in part at any time without premium or penalty (other than during the six months following May 9, 2018 on the amount of loans prepaid or repaid in connection with a repricing transaction, as defined in the credit agreement.

Revolving Credit Facility. The revolving credit facility consists of a five-year senior secured facility with aggregate commitments in an amount equal to $250 million, of which up to $50 million is available for the issuance of letters of credit. Amounts repaid under the revolving credit facility may be re-borrowed. The revolving credit facility matures in May 2023.

A summary of our borrowings and payment to Dover as part of the Separation was as follows:



(in thousands)
Proceeds from issuance of debt	$	715,000
Debt discounts	(1,038		)
Debt issuance costs	(13,854		)
Net proceeds	700,108
Cash payment to Dover	(700,000		)
Net cash retained by Apergy	$	108

Inventories (Tables)

3 Months Ended

Mar. 31, 2018

Inventory, Net [Abstract]

Components of Inventory



(in thousands)	March 31, 2018			December 31, 2017
Raw materials	$	51,036		$	45,408
Work in progress	12,914			10,879
Finished goods	171,307			167,416
	235,257			223,703
LIFO and valuation adjustments	(24,316		)	(22,112		)
Inventories, net	$	210,941		$	201,591

Property, Plant and Equipment (Tables)

3 Months Ended

Mar. 31, 2018

Property, Plant and Equipment [Abstract]

Components of property, plant and equipment, net

Property, plant and equipment consisted of the following:



(in thousands)	March 31, 2018			December 31, 2017
Land	$	13,552		$	13,557
Buildings and improvements	99,339			99,233
Machinery, equipment and other	463,306			446,261
	576,197			559,051
Accumulated depreciation	(356,142		)	(347,219		)
Property, plant and equipment, net	$	220,055		$	211,832

Goodwill and Other Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

The carrying amount, including changes therein, of goodwill by reporting segment was as follows:



(in thousands)	Production & Automation Technologies			Drilling Technologies		Total
December 31, 2017	$	808,952		$	101,136	$	910,088
Purchase price adjustment ^*	(53		)	—		(53		)
Foreign currency translation	(998		)	—		(998		)
March 31, 2018	$	807,901		$	101,136	$	909,037

Schedule of Intangible Assets

The components of our definite- and indefinite-lived intangible assets were as follows:



	March 31, 2018						December 31, 2017
(in thousands)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Definite-lived intangible assets:
Customer intangibles	$	571,800	$	287,340	$	284,460	$	572,415	$	276,655	$	295,760
Trademarks	36,308		18,750		17,558		36,312		17,821		18,491
Patents	38,547		21,075		17,472		38,679		20,449		18,230
Unpatented technologies	9,700		9,700		—		9,700		9,700		—
Drawings and manuals	3,051		2,118		933		3,067		2,109		958
Other	5,355		3,934		1,421		5,382		3,911		1,471
	664,761		342,917		321,844		665,555		330,645		334,910
Indefinite-lived intangible assets:
Trademarks	3,600		—		3,600		3,600		—		3,600
Total	$	668,361	$	342,917	$	325,444	$	669,155	$	330,645	$	338,510

Accumulated Other Comprehensive Loss (Tables)

3 Months Ended

Mar. 31, 2018

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Schedule of Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss consisted of the following:



(in thousands)	Foreign Currency Translation			Defined Pension and Other Post-Retirement Benefits			Accumulated Other Comprehensive Loss
December 31, 2017	$	(21,935	)	$	(4,480	)	$	(26,415	)
Other comprehensive income (loss) before reclassifications, net of tax	(1,691		)	—			(1,691		)
Reclassification adjustment for net losses (gains) included in net income, net of tax	—			49			49
Other comprehensive income (loss), net of tax	(1,691		)	49			(1,642		)
Reclassification adjustment for cumulative effect of change in accounting principle	—			(1,315		)	(1,315		)
March 31, 2018	$	(23,626	)	$	(5,746	)	$	(29,372	)

Reclassification Out of Accumulated Other Comprehensive Loss

Reclassification adjustments from accumulated other comprehensive loss to net income related to defined pension and other post-retirement benefits consisted of the following:



	Three Months Ended March 31,						Affected line items on the condensed combined statements of income
(in thousands)	2018			2017
Amortization of actuarial loss	$	65		$	99		⁽¹⁾
Tax benefit	(16		)	(24		)	Provision for income taxes
	$	49		$	75		Net income

Revenue (Tables)

3 Months Ended

Mar. 31, 2018

Revenue from Contract with Customer [Abstract]

Schedule of Disaggregation of Revenue

Revenue disaggregated by end market in each of our reporting segments was as follows:



	Three Months Ended March 31,
(in thousands)	2018
Drilling Technologies	$	69,231
Production & Automation Technologies:
Artificial lift technologies	167,341
Automation technologies	24,363
Other production equipment	24,696
Intra-segment eliminations	(1,709		)
Total	214,691
Total revenue	$	283,922

Revenue disaggregated by geography was as follows:



	Three Months Ended March 31,
(in thousands)	2018
United States	$	221,239
Canada	22,584
Middle East	10,338
Europe	9,022
Latin America	7,686
Asia-Pacific	6,070
Other	6,983
Total revenue	$	283,922

Schedule of Contract Balances

Contract assets and contract liabilities from contracts with customers were as follows:



(in thousands)	March 31, 2018	January 1, 2018
Contract assets	2,806	4,733
Contract liabilities - current	5,947	4,487

Restructuring Activities (Tables)

3 Months Ended

Mar. 31, 2018

Restructuring [Abstract]

Schedule of Restructuring and Related Costs

Restructuring and other charges by reporting segment were as follows:



	Three Months Ended March 31,
(in thousands)	2018		2017
Production & Automation Technologies	$	482	$	6
Drilling Technologies	—		—
Total	$	482	$	6

Classification of amounts in the condensed combined statements of income:
Cost of goods and services	$	3	$	(7	)
Selling, general and administrative expense	479		13
Total	$	482	$	6

Equity and Cash Incentive Program (Tables)

3 Months Ended

Mar. 31, 2018

Share-based Compensation [Abstract]

Schedule of Stock-Based Compensation Expense

Stock-based compensation expense relating to all stock-based incentive plans was as follows:



	Three Months Ended March 31,
	2018			2017
Stock-based compensation expense	$	510		$	601
Tax benefit	(113		)	(208		)
Stock-based compensation expense, net of tax	$	397		$	393

Employee Benefit Plans (Tables)

3 Months Ended

Mar. 31, 2018

Defined Benefit Plan [Abstract]

Schedule of Defined Benefit Plans Disclosures



	Non-U.S. Qualified Defined Benefit Plan
	Three Months Ended March 31,
(in thousands)	2018			2017
Service cost	$	31		$	26
Interest cost	33			34
Expected return on plan assets	(56		)	(49		)
Amortization of actuarial loss	14			17
Net periodic benefit cost	$	22		$	28



	Non-Qualified Supplemental Benefits Plan
	Three Months Ended March 31,
(in thousands)	2018		2017
Service cost	$	—	$	—
Interest cost	112		155
Amortization of actuarial loss	51		82
Net periodic benefit cost	$	163	$	237

Segment Information (Tables)

3 Months Ended

Mar. 31, 2018

Segment Reporting [Abstract]

Revenue and earnings from continuing operations by market segment

Segment revenue and segment earnings were as follows:



	Three Months Ended March 31,
(in thousands)	2018		2017
Segment revenue:
Production & Automation Technologies	$	214,691	$	180,800
Drilling Technologies	69,231		49,478
Total revenue	$	283,922	$	230,278

Income before income taxes:
Segment earnings:
Production & Automation Technologies	$	10,351	$	7,877
Drilling Technologies	24,189		14,720
Total segment earnings	34,540		22,597
Corporate expense and other ⁽¹⁾	2,635		2,805
Income before income taxes	$	31,905	$	19,792

_______________________


(1)	Corporate expense include costs not directly attributable to our reporting segments such as corporate executive management and other administrative functions. Includes the net income attributable to our noncontrolling interest.

Subsequent Events (Tables)

3 Months Ended

Mar. 31, 2018

Subsequent Events [Abstract]

Schedule of Subsequent Events

Pro Forma Financial Information



	Three Months Ended March 31,
(in thousands, except per share data)	2018		2017
Net income attributable to Apergy	$	24,543	$	13,269
Pro forma earnings per share: ⁽¹⁾
Basic	$	0.32	$	0.17
Diluted	$	0.31	$	0.17
Pro forma shares outstanding: ⁽²⁾
Basic	77,340		77,340
Diluted	78,329		78,329

_______________________


(1)	Pro forma basic and diluted earnings per share was determined by dividing historical net income attributable to Apergy by pro forma shares outstanding during each of the periods presented.

(2)

Schedule of Borrowings and Contribution

A summary of our borrowings and payment to Dover as part of the Separation was as follows:



(in thousands)
Proceeds from issuance of debt	$	715,000
Debt discounts	(1,038		)
Debt issuance costs	(13,854		)
Net proceeds	700,108
Cash payment to Dover	(700,000		)
Net cash retained by Apergy	$	108

Basis of Presentation Change in Accounting Principle (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Cumulative effect of accounting changes (Note 2)	$ 0
Selling, general and administrative expense	59,739	$ 52,639
Cost of goods and services	189,661	154,918
Restatement Adjustment [Member]
Selling, general and administrative expense		(10,700)
Cost of goods and services		$ 10,700
Accounting Standards Update 2016-15 [Member]
Cumulative effect of accounting changes (Note 2)	$ 900

Basis of Presentation Separation (Details)			3 Months Ended
Basis of Presentation Separation (Details)	May 09, 2018 USD ($) company shares	May 03, 2018 USD ($)	Mar. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Debt Instrument [Line Items]
Intercompany notes payable			$ 221,400,000	$ 224,500,000
Interest Expense			$ 0
Subsequent Event
Debt Instrument [Line Items]
Conversion ratio	0.5
Number of companies separated \| company	2
Common stock issued (in shares) \| shares	77,339,828
Principal amount of debt issued	$ 715,000,000
Business separation payment	700,000,000	$ 700,000,000
Subsequent Event \| Term Loan Facility
Debt Instrument [Line Items]
Principal amount of debt issued	$ 415,000,000
6.375% Senior Notes Due May 2026 \| Subsequent Event \| Senior Notes
Debt Instrument [Line Items]
Principal amount of debt issued		$ 300,000,000

Recent Accounting Standards Recent Accounting Standards (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2018 USD ($)
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect of accounting changes (Note 2)	$ 0
Accounting Standards Update 2016-15 [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect of accounting changes (Note 2)	900
Net Parent Investment in Apergy
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect of accounting changes (Note 2)	$ 1,315

Related Party Transactions (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Related Party Transaction, Selling, General and Administrative Expenses from Transactions with Related Party	$ 5.8	$ 6.1
Noncontrolling Interest
Related Party Transaction, Rate	5.00%
Royalty Agreements [Member]
Related Party Transaction, Expenses from Transactions with Related Party	$ 2.3	$ 2.3

Inventories (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Inventory, Net [Abstract]
Raw materials	$ 51,036	$ 45,408
Work in progress	12,914	10,879
Finished goods	171,307	167,416
Subtotal	235,257	223,703
LIFO and valuation adjustments	(24,316)	(22,112)
Inventories, net	$ 210,941	$ 201,591

Property, Plant and Equipment (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Property, Plant and Equipment [Line Items]
Cost	$ 576,197	$ 559,051
Accumulated depreciation	(356,142)	(347,219)
Property, plant and equipment, net	220,055	211,832
Land [Member]
Property, Plant and Equipment [Line Items]
Cost	13,552	13,557
Buildings and improvements [Member]
Property, Plant and Equipment [Line Items]
Cost	99,339	99,233
Machinery, equipment and other [Member]
Property, Plant and Equipment [Line Items]
Cost	$ 463,306	$ 446,261

Goodwill and Other Intangible Assets - Goodwill (Details) - USD ($)
$ in Thousands

3 Months Ended

Mar. 31, 2018

Dec. 31, 2017

Goodwill [Roll Forward]

Purchase price adjustments

$ 909,037

$ 910,088

^[1]

(53)

Foreign currency translation

(998)

Drilling Technologies [Member]

909,037

Goodwill [Roll Forward]

Purchase price adjustments

101,136

^[1]

Foreign currency translation

Production and Automation Technologies [Member]

101,136

Goodwill [Roll Forward]

Purchase price adjustments

807,901

$ 808,952

^[1]

(53)

Foreign currency translation

(998)

Reconciliation from Segment Totals to Consolidated [Abstract]

$ 807,901

[1]	Purchase price adjustment related to our 2017 acquisition of PCP Oil Tools S.A. and Ener Tools S.A.

Goodwill and Other Intangible Assets - Intangible Assets and Amortization Expense (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	$ 664,761	$ 665,555
Accumulated amortization	342,917	330,645
Finite-Lived Intangible Assets, Net	321,844	334,910
Intangible Assets, Gross (Excluding Goodwill)	668,361	669,155
Intangible assets, net	325,444	338,510
Trademarks [Member]
Finite-Lived Intangible Assets [Line Items]
Accumulated amortization	0	0
Indefinite-Lived Intangible Assets (Excluding Goodwill)	3,600	3,600
Customer Intangibles [Member]
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	571,800	572,415
Accumulated amortization	287,340	276,655
Finite-Lived Intangible Assets, Net	284,460	295,760
Trademarks [Member]
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	36,308	36,312
Accumulated amortization	18,750	17,821
Finite-Lived Intangible Assets, Net	17,558	18,491
Patents [Member]
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	38,547	38,679
Accumulated amortization	21,075	20,449
Finite-Lived Intangible Assets, Net	17,472	18,230
Unpatented Technologies [Member]
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	9,700	9,700
Accumulated amortization	9,700	9,700
Finite-Lived Intangible Assets, Net	0	0
Drawings and Manuals [Member]
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	3,051	3,067
Accumulated amortization	2,118	2,109
Finite-Lived Intangible Assets, Net	933	958
Other Intangible Assets [Member]
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	5,355	5,382
Accumulated amortization	3,934	3,911
Finite-Lived Intangible Assets, Net	$ 1,421	$ 1,471

Goodwill and Other Intangible Assets - Indefinite-lived Intangibles (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Trademarks [Member]
Indefinite-lived Intangible Assets by Major Class [Line Items]
Gross carrying amount	$ 3,600	$ 3,600

Accumulated Other Comprehensive Loss - Schedule of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	$ 1,635,285
Other comprehensive income (loss) before reclassifications, net of tax	(1,691)
Reclassification adjustment for net losses (gains) included in net income, net of tax	49
Other comprehensive income (loss)	(1,642)	$ 1,773
New Accounting Pronouncement or Change in Accounting Principle, Cumulative Effect of Change on Equity or Net Assets	(1,315)
Ending balance	1,656,551
AOCI Attributable to Parent [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(26,415)
Other comprehensive income (loss)	(1,642)
Ending balance	(29,372)
Foreign Currency Translation
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(21,935)
Other comprehensive income (loss) before reclassifications, net of tax	(1,691)
Reclassification adjustment for net losses (gains) included in net income, net of tax	0
Other comprehensive income (loss)	(1,691)
New Accounting Pronouncement or Change in Accounting Principle, Cumulative Effect of Change on Equity or Net Assets	0
Ending balance	(23,626)
Defined Pension and Other Post-Retirement Benefits
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(4,480)
Other comprehensive income (loss) before reclassifications, net of tax	0
Reclassification adjustment for net losses (gains) included in net income, net of tax	49
Other comprehensive income (loss)	49
New Accounting Pronouncement or Change in Accounting Principle, Cumulative Effect of Change on Equity or Net Assets	(1,315)
Ending balance	$ (5,746)

Accumulated Other Comprehensive Loss - Reclassification Out of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Amortization of actuarial loss	$ 189,661	$ 154,918
Tax benefit	7,220	6,206
Net income	24,543	13,269
Reclassification out of Accumulated Other Comprehensive Income
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Amortization of actuarial loss	(65)	(99)
Tax benefit	16	24
Net income	$ 49	$ 75

Commitments and Contingencies (Details) - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Commitments and Contingencies Disclosure [Abstract]
Proceeds from issuance of debt	$ 7.8	$ 8.1

Revenue - Narrative (Details)	3 Months Ended
Revenue - Narrative (Details)	Mar. 31, 2018
Short-term Contract with Customer [Member]
Disaggregation of Revenue [Line Items]
Contract term	1 year
Long-term Contract with Customer [Member]
Disaggregation of Revenue [Line Items]
Contract term	1 year
Minimum [Member]
Disaggregation of Revenue [Line Items]
Payment terms	30 days
Maximum [Member]
Disaggregation of Revenue [Line Items]
Payment terms	90 days
Product Concentration Risk [Member] \| Lease Revenue [Member]
Disaggregation of Revenue [Line Items]
Concentration Risk, Percentage	3.00%
Product Concentration Risk [Member] \| Other Revenue [Member]
Disaggregation of Revenue [Line Items]
Concentration Risk, Percentage	1.00%
Product [Member] \| Product Concentration Risk [Member] \| Sales Revenue, Net [Member]
Disaggregation of Revenue [Line Items]
Concentration Risk, Percentage	89.00%
Service [Member] \| Product Concentration Risk [Member] \| Sales Revenue, Net [Member]
Disaggregation of Revenue [Line Items]
Concentration Risk, Percentage	7.00%

Revenue - Disaggregation of Revenue (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2018 USD ($)
Disaggregation of Revenue [Line Items]
Revenue	$ 283,922
UNITED STATES
Disaggregation of Revenue [Line Items]
Revenue	221,239
CANADA
Disaggregation of Revenue [Line Items]
Revenue	22,584
Middle East [Member]
Disaggregation of Revenue [Line Items]
Revenue	10,338
Europe [Member]
Disaggregation of Revenue [Line Items]
Revenue	9,022
Latin America [Member]
Disaggregation of Revenue [Line Items]
Revenue	7,686
Asia Pacific [Member]
Disaggregation of Revenue [Line Items]
Revenue	6,070
Other [Member]
Disaggregation of Revenue [Line Items]
Revenue	6,983
Drilling Technologies [Member]
Disaggregation of Revenue [Line Items]
Revenue	69,231
Production and Automation Technologies [Member]
Disaggregation of Revenue [Line Items]
Revenue	214,691
Production and Automation Technologies [Member] \| Intersegment Eliminations [Member]
Disaggregation of Revenue [Line Items]
Revenue	(1,709)
Production and Automation Technologies [Member] \| Artificial Lift Technologies [Member]
Disaggregation of Revenue [Line Items]
Revenue	167,341
Production and Automation Technologies [Member] \| Automation Technologies [Member]
Disaggregation of Revenue [Line Items]
Revenue	24,363
Production and Automation Technologies [Member] \| Other Production Equipment [Member]
Disaggregation of Revenue [Line Items]
Revenue	$ 24,696

Revenue - Contract Balances (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Jan. 01, 2018
Revenue from Contract with Customer [Abstract]
Contract assets	$ 2,806	$ 4,733
Contract liabilities - current	$ 5,947	$ 4,487

Restructuring Activities (Details) - USD ($) $ in Thousands	3 Months Ended
Restructuring Activities (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017
Restructuring Cost and Reserve [Line Items]
Restructuring charges	$ 482	$ 6
Restructuring Reserve	2,500		$ 2,600
Production and Automation Technologies [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges	482	6
Drilling Technologies [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges	0	0
Cost of Sales [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges	3	(7)
Selling, General and Administrative Expenses [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges	$ 479	$ 13
Minimum [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring Initiatives, Term	12 months
Maximum [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring Initiatives, Term	18 months

Income Taxes (Details)	3 Months Ended
Income Taxes (Details)	Mar. 31, 2018	Mar. 31, 2017
Income Tax Disclosure [Abstract]
Effective tax rate (as a percent)	22.60%	31.40%
Effective Income Tax Rate, Federal Statutory Income Tax Rate (as a percent)	21.00%	35.00%

Equity and Cash Incentive Program (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Stock-based compensation expense [Abstract]
Stock-based compensation expense	$ 510	$ 601
Tax benefit	(113)	(208)
Stock-based compensation expense, net of tax	$ 397	$ 393
Stock Appreciation Rights
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	3 years
Expiration period	10 years
Options issued during period (in shares)		79,970
Performance Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares, other than options, issued during period (in shares)		4,162
Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares, other than options, issued during period (in shares)		24,319

Employee Benefit Plans (Details) $ in Thousands	3 Months Ended
Employee Benefit Plans (Details) $ in Thousands	Mar. 31, 2018 USD ($) plan	Mar. 31, 2017 USD ($)
Net periodic benefit cost [Abstract]
Defined contribution plan expense	$ 2,400	$ 2,000
Defined Benefit Pension Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Number of plans \| plan	1
Qualified Plan [Member] \| Defined Benefit Pension Plans [Member]
Net periodic benefit cost [Abstract]
Service cost	$ 31	26
Interest cost	33	34
Expected return on plan assets	(56)	(49)
Recognized actuarial gain	14	17
Net periodic expense	22	28
Nonqualified Plan [Member] \| Supplemental Benefits Plan [Member]
Net periodic benefit cost [Abstract]
Service cost	0	0
Interest cost	112	155
Recognized actuarial gain	51	82
Net periodic expense	$ 163	237
Canada Salaried Pension Plan [Member]
Defined Benefit Plan Disclosure [Line Items]
Contributions to plan		$ 200

Segment Information (Details) - USD ($)
$ in Thousands

3 Months Ended

12 Months Ended

Mar. 31, 2018

Mar. 31, 2017

Dec. 31, 2017

Reconciliation of Earnings from Continuing Operations from Segments to Consolidated [Abstract]

$ 283,922

$ 230,278

Production and Automation Technologies [Member]

31,905

19,792

Reconciliation from Segment Totals to Consolidated [Abstract]

Reconciliation of Earnings from Continuing Operations from Segments to Consolidated [Abstract]

214,691

180,800

Drilling Technologies [Member]

10,351

7,877

Reconciliation from Segment Totals to Consolidated [Abstract]

Reconciliation of Earnings from Continuing Operations from Segments to Consolidated [Abstract]

69,231

49,478

Reconciliation of Earnings from Continuing Operations from Segments to Consolidated [Abstract]

24,189

14,720

Total segments [Member]

Corporate expense / other [Member]

22,597

$ 34,540

Reconciliation of Earnings from Continuing Operations from Segments to Consolidated [Abstract]